The base metal, which is widely used in myriad industry thus is sensitive to worldwide financial and economic developments, spearheaded the downward dive of other base metals. Supplies of copper already are hovering near their top amount in about a decade.
The central bank of the Asian nation said a suitable amount of liquidity is available in its financial system and its encourages banks to rein in risks from credit expansion. That indicates cash is unlikely to prompt any sort of relief. Further, Indonesian mine Grasberg is preparing to click into motion after having been idle since an industrial accident in the middle of last month.
"Market sentiment for copper is decidedly bearish," states a report authored by analyst Mark Pervan with Australia & New Zealand Banking Group Ltd. in Melbourne, according to Bloomberg. Grasberg, the globe's second-largest copper mine, is "removing some of the supply-tightness from the market."
At 8:29 a.m. on Monday, copper futures dove 2.47 percent, a 0.0765-cent loss to $3.0235 per pound.
China, host of the globe's second-largest economy, has seen various hiccups emerge during the past two years. It also is the biggest consumer of the reddish metal.
But those ongoing issues with the economy do not bode well for the base metal.
"Liquidity is tight in China," states a Monday email to the news service authored by Asian commodities trading director Pengjiang Fu with Newedge Group SA in London. "The general mood in the Chinese stock market and global commodities market is pretty bearish at the moment."
Approaching three-year trough
Reuters reports copper futures dropped to their lowest price since July 2010.
Losses for the reddish metal on Monday mark the fifth bearish trading session in the past six days, which also is linked with the emboldened U.S. dollar. The greenback drew strength from Chairman Ben Bernanke with the U.S. Federal Reserve stating last week after adjournment of two days of policy meetings that the globe's largest economy is aspiring to reduce bond purchases in the coming months and completely withdraw it by the end of the year. But that will depend on the progress of the economy's growth and development.
"In line with the majority of the commodity complex, base metal prices have come under significant pressure over the past week," analyst Gayle Berry with Barclays told Reuters on Monday. "The broad risk-off move has been driven largely by macro developments, essentially a combination of continued weakness in Chinese economic data and a shortened time horizon for Fed tapering expectations."
The Wall Street Journal reports the reddish metal on Monday slumped to its lowest value thus far this year.
The publication pointed to the Asian nation, noting its use of the reddish metal accounts for roughly 40 percent of the world's consumption.
Concerns are steadily growing in the market as the reddish metal has seen an increased pace of losses during the past several trade sessions.
Xinhua, the state operated media agency in China, published commentary on Monday that noted the Asian nation is unlikely to implement efforts to relax tight liquidity anytime soon.
"The outlook for Chinese demand in the short term is negative," analyst Joyce Liu with Phillip Futures Investment told the publication, noting that constricted liquidity could convert to increased costs for firms that import copper into China.
This year's imports have been a lot lower as compared to those of last year, The Wall Street Journal reports. Refined copper imports last month were 23 percent lower as compared to the same period last year.
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